Mack-Cali Realty Corp. said Monday it completed the first transaction in a 1031 exchange that, when complete, will total more than $820 million in value.
The transaction is comprised of the purchase of Liberty Towers, a 648-unit residential tower on the Jersey City Gold Coast, at the end of the third quarter, and the to-be-completed sale of the Chase at Overlook Ridge and Alterra at Overlook Ridge located in Boston, Mass.
The Overlook Ridge properties are under definitive contract to be sold to Rockpoint Group LLC for approximately $411.5 million. The deal is expected to close by the end of October. The properties, developed by Mack-Cali’s Roseland Residential Trust subsidiary were completed in 2014 and 2008, respectively.
Proceeds from the sale of the Overlook properties will be used to fund the company’s purchase of Liberty Towers, a high-rise residential community for $409 million, which was initially financed with a $232 million mortgage and the company’s line of credit. Sales proceeds from the Overlook Properties will be used to repay the company’s line.
Michael DeMarco, Mack-Cali chief executive officer stated: “We are pleased to further add to our portfolio on the highly desirable Jersey City waterfront through the efficient sale of a portion of our Boston multifamily properties and the purchase of Liberty Towers. This transaction allows us to further concentrate our capital on the waterfront where we believe our market share and operating familiarity with the community should allow us to enhance the performance of Liberty Towers.”
Mack-Cali also announced it expects to receive $2.6 million of proceeds associated with the sale of its Urby tax credit in the fourth quarter of 2019. This tax credit will have a direct benefit to the company’s Funds from Operations.